Find the beginning inventory for June.
| | Beginning Inventory | Purchases | Units Sold |
| :---- | :------------------ | :-------- | :--------- |
| April | 2,200 | 700 | 1,300 |
| May | 1,600 | 800 | 600 |
| June | {[?]} | 400 | 1,500 |
Answer (2)
Calculate the ending inventory for April: 2200 + 700 − 1300 = 1600 .
Calculate the ending inventory for May: 1600 + 800 − 600 = 1800 .
The beginning inventory for June is equal to the ending inventory of May.
Therefore, the beginning inventory for June is 1800 .
Explanation
Understanding the Problem Let's analyze the inventory data to find the beginning inventory for June. We know that the ending inventory of a month becomes the beginning inventory of the next month. Therefore, we need to find the ending inventory for May to determine the beginning inventory for June.
Calculating Ending Inventory for April First, we need to calculate the ending inventory for April. The formula for ending inventory is:
Ending Inventory = Beginning Inventory + Purchases - Units Sold
For April: Beginning Inventory = 2,200 Purchases = 700 Units Sold = 1,300
So, the ending inventory for April is:
Ending Inventory = 2,200 + 700 - 1,300 = 1,600
Calculating Ending Inventory for May Next, we calculate the ending inventory for May using the same formula:
Ending Inventory = Beginning Inventory + Purchases - Units Sold
For May: Beginning Inventory = 1,600 Purchases = 800 Units Sold = 600
So, the ending inventory for May is:
Ending Inventory = 1,600 + 800 - 600 = 1,800
Determining Beginning Inventory for June Since the ending inventory for May is 1,800, the beginning inventory for June is also 1,800.
Final Answer Therefore, the beginning inventory for June is 1,800.
Examples
Understanding inventory management is crucial in business. For example, a store owner needs to track their inventory to know when to reorder products. By calculating beginning and ending inventory, purchases, and units sold, they can optimize their stock levels, reduce storage costs, and meet customer demand efficiently. This problem demonstrates a simplified version of these calculations, which are essential for maintaining a healthy supply chain and avoiding stockouts or overstocking.
The beginning inventory for June is found to be 1,800, which is equal to the ending inventory of May. To calculate this, we used the formula for ending inventory based on the previous month's data. Hence, the answer is 1,800.
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